Which of the Following Is Not an Example of an Auditing

question 48

Multiple Choice

Which of the following is not an example of an auditing standard?

• A) The audit must be performed by a person having adequate technical training and proficiency as an auditor.
• B) In all matters relating to the assignment, independence in mental attitude is to be maintained by the auditor so as to establish the "third-party viewpoint."
• C) Professional care is to be exercised in the performance of the examination and in the preparation of the report.
• D) The auditor should be politically conservative.
• E) None of the above

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Definitions:

Product Costs

The costs incurred by a company to manufacture or acquire a product which include materials, labor, and overhead.

Direct Materials

Raw materials that are directly traceable to the production of a specific good or service.

Direct Labor

The wages and benefits for employees directly involved in the production of goods or services.

Plantwide Factory Overhead Rate

A single overhead absorption rate used across an entire manufacturing plant, calculated by dividing the total factory overhead by a predetermined base, such as total direct labor hours or machine hours.